Glossary

Write-down

A write-down partially reduces an asset's book value when it is worth less than recorded — a non-cash charge that keeps stock and asset values realistic.

2 min read

Partial value cutNon-cash charge

vs full write-offRealism in accounts

Definition

A write-down reduces the carrying value of an asset (such as slow-moving stock or an impaired machine) to a lower realistic value. Unlike a full write-off, some value remains.

In plain terms

It is trimming an asset’s book value to what it is really worth — for example marking obsolete stock down to clearance price.

Why it matters for your company

Write-downs hit profit now but keep the balance sheet honest and lender-credible. A pattern of stock write-downs may point to over-ordering. See impairment.